After decades in the world of ratings and having studied the history of the business, one thing is clear. There is room for one and a half companies. Whenever competitors existed, for example Nielsen and Arbitron in local TV, or Arbitron and Birch in local radio, one won, and one lost. I write from personal experience because I was working at Birch/Scarborough when the company was shut down in 1991.
I say one and a half companies because having a monopoly situation implies higher prices and I don’t think any ratings company that won a competitive situation has ever been known for offering “low low prices” to clients. Each takes advantage of their market position. Sure, Eastlan is still out there as an option to Nielsen Audio, but Mike Gould has been smart enough to avoid competing head-on with Nielsen (and Arbitron before it). His company has a nice niche in small markets.
With that said, there is a competitive situation in a subset of the marketplace that’s gone on for years. We refer to it as “qualitative” which is really a misnomer. In media, we think of qualitative information as something beyond age/sex ratings, meaning planned purchases, deeper household information, etc. This is really extended quantitative information, while “qualitative” in research terms refers to types of research that can’t be projected, such as focus groups, one-on-one interviews, etc.
The competitive companies are Scarborough and The Media Audit (TMA). Scarborough was founded by Harold Israel in 1974 and TMA by Bob Jordan and Jim Higginbothan in 1972. Scarborough is owned by Nielsen, a result of VNU buying the company in the ‘80s and merging it with Birch, creating Birch/Scarborough. When Birch went under, Arbitron and Nielsen picked up Scarborough in a 50/50 arrangement. As a result of Nielsen’s acquisition of Arbitron, they took full control.
When Birch went under in 1991, Phil Beswick, who started Birch Canada and then worked for Birch in the US, went to work for TMA. Much like Victor Kiam with Remington shavers, he liked the company so much that he eventually bought it.
Phil and I go back a long way as friends, and we were chatting recently about the state of the industry. I thought it would be a public service to readers to remind them that there are two options if you’re using qualitative to help sell your stations. Both are good services, both can help you make money, but the two are different from each other.
I think it is a necessity to have at least one of these services, if not both. Regular readers know about the decline in radio listening over time and that means many stations have just about the same ratings, especially when comparing rating points. Stations and clusters need to find ways to differentiate themselves from the competition which as we all know is more than just radio. Ratings are a silo, but qualitative offers a much broader view.
Who’s planning to buy a new car in the next year? How much will they spend? Who goes to concerts or spends on high end restaurants? What about lifestyles? What other media do they use? Are they heavy or light TV or streaming users? Do they drink or abstain? Do listeners use brick and mortar stores or are they more likely to shop online? The two services provide this kind of information.
At the BNM Summit earlier this month, I heard markets managers say “we’re always hiring account executives” no matter how tight the revenue situation. For much less than the cost of another AE, why not have both services in-house? To hire an AE, you have the costs of interviewing, hiring, onboarding, and if the person doesn’t cut it, firing. Why not go with both services and take the better story to each potential client? If you want to be a “consultant” and bring more information to local retailers, having access to two services rather than one should be a net positive, referring to the bottom line.
Programmers can use qualitative as well. I doubt there is any station’s audience that is defined solely on age/sex demographics.If you have qualitative in your building, use it. What do your listeners do? What do the competition’s listeners do? If you don’t know how to access and understand the data, both services have ways to get you trained.
It’s easy for me as a semi-retired researcher to suggest spending more money that you don’t have on research, but this is an investment that should pay back in multiples. If you don’t have qualitative at all or if you want to consider having both, call your Nielsen rep about Scarborough and call Phil and his group about The Media Audit. See if they can make the dollars work for you. Then get your folks out on the street armed with even more knowledge about their market that can be turned into more business for them and more revenue for you.
Let’s meet again next week.
